A legislative panel Thursday approved a new rule governing eligibility for the state's emergency housing assistance program, though not without reservations.

At issue - who will qualify for a motel room at taxpayer expense.

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Reports of abuse and soaring costs last year prompted lawmakers to direct the Department of Children and Families to reign in expenses.

The solution DCF proposed remains controversial.

The department agreed to exempt the most vulnerable populations from the point system that will determine eligibility for a motel room; the elderly, the disabled, those with very young children or in late-term pregnancy will get a room.

But the Legislative Committee on Administrative Rules Thursday heard from a series of homeless advocates who say the point system are still too strict and will exclude too many.

Witnesses particularly objected to the provision requiring a homeless person to cover a portion of the motel expense, and the new limit of 28-nights in a motel.

(The average motel stay last year was 36 nights, officials said, and the program had limited stays to no more than 84 nights.)

"I'm sure the Legislature didn't intend for people to have to pay 50 percent of their of the last pennies they have toward their stay in a motel," said Joe Patrissi of Northeast Kingdom Community Action Agency. "There are truly a lot of homeless people who are desperate due to the recession, divorce, domestic violence, loss of a job, or a medical problem."

Sen. Diane Snelling, a Chittenden County Republican and a member of the panel expressed strong reservations over the new rule.

State costs for motel rooms typically average $60 a night.

"I think it's illogical- for anyone who is homeless - to assume they have money to contribute toward their shelter," Snelling said.

Chris Carpenter, a case manager at Fletcher Allen, says the state's largest hospital doesn't like the new rules either. The hospital treats up to 10 homeless patients a month, he said, and they're now unlikely to qualify for a motel room upon discharge.

"It makes no sense to discharge them onto the street," Carpenter told lawmakers, "(and) it makes no sense for us to keep an individual in the hospital for lack of a safe discharge at great expense to the health care system."

While lawmakers unanimously approved the new rule Thursday, they directed DCF to consider the objections offered Thursday and promised to hold another hearing in the fall.